South Korean economic growth slows sharply as drought, MERS outbreak weigh

Peter Macdiarmid/Getty Images

South Korean economic growth, weighed down by an outbreak of Middle Eastern Respiratory Syndrome (MERS) and persistent drought conditions, slowed sharply in the June quarter.

The advanced GDP reading fell to 0.3%, below the 0.8% level seen in Q1 and expectations for an expansion of 0.4%. The slowdown saw the annual rate dip to 2.2%, the lowest level seen since the March quarter of 2013.

Over the quarter the manufacturing, construction and services sectors expanded by 0.8, 0.4% and 0.1% respectively, offsetting a steep 11.1% contraction in primary industries.

From a year earlier services recorded the strongest expansion in activity, 3.0%, while primary industries slid by 3.5%.

In the three months to June consumer spending contracted 0.3%, down heavily on the 0.6% expansion recorded previously, while government expenditure accelerated to 0.7% from 0.2% in the March quarter.

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